Obama on the Nat’l Debt: ‘We’ve Made Some Cuts in Spending,’ Cut Deficit Two-Thirds

GOVERNOR: “Quick question. Something that effects each of us as governors individually is debt. It’s crippling to some of us, less so to others. Curious as to your thoughts on the debt of this nation and the lack of any political discourse on either side of the aisle in any of the debates on this issue. And what, in the next 10 months your administration can do to draw attention to this, to address it, to change — start to change the course of direction, that is currently underway?”
OBAMA: “Well, we’re going to be releasing a budget so that will be a significant topic of conversation. Maybe I’ll just break it out into its component parts. Obviously, the federal government unlike state governments does not have in the constitution that at the end of each year it has to balance its budget. I know that there are those in this room who would probably be for the federal government having a balanced-budget amendment. I would not be one of those because — in modern economic history what is clear is that there has to be some flexibility for the federal government, the sovereign nation to issue that in order to deal with recession, national emergencies and so on. What is also true is the way that the federal government keeps the books is different than an ordinary business. Lot of times people will use a family or a business as an example but — just to take one instance, the federal government doesn’t have a separate accounting for capital expenditures which you would then depreciate and — so you would have a whole another way of doing bookkeeping. [phone rings] There you go. That happens to me all the time. (Laughter) So, the analogy is not exactly the same as the federal government versus state governments or businesses or families. Now, having said that, the good news is that — since so I came and off as we’ve reduced the deficit by two thirds. That is a combination of the recovery, which brought in more tax revenue. Raising taxes on the top 2 percent, which everybody claimed was going to be a jobs killer, but we’ve now had 14 million jobs created or more essentially over the last six years. And we’ve made some cuts in spending. All of that has led to a two-thirds reduction. And that our budget will reflect —“